Differential Research is an independent provider of derivative research specializing in US exchanges traded options and Exchange Traded Funds (ETF’s.) Differential seeks to capitalize on a growing demand for derivative based market commentary and analysis, the result of both a growing awareness of the importance of incorporating risk analysis in the investment process and the explosion in trading of derivative products.
Historically the investment process has been dominated by the estimation of cash flows by research analysts and investment information providers. However, the analysis, understanding and estimation of risk, a is only now being recognized as an integral and significant factor in the investment discounting process. It is our belief that much as the “crash” of 1987 redefined the understanding and use of futures, the events of the market decline of 2007-2008 will be a similar watershed event for the appreciation of the roll played by options as a barometer of risk expectations and ETF’s as a tool for the isolation of sector and asset class risks. Consequently, we believe derivative research will likely experience significant growth for the next several years and that Differential Research will be in a position to capitalize on the growth in this market.